Financial Markets Authority application

[2025] NZHC 2010

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

2025/05 [2025] NZHC 2010

UNDERSection 29 of the Financial Markets Authority Act 2011 and Part 4 of the Search and Surveillance Act 2012

IN THE MATTER

AND

of an investigation by the Financial Markets Authority into breaches of the Crimes Act 1961, the Financial Markets Conduct Act 2013 and the Companies Act 1993

IN THE MATTER             of an application by Fiona Janet Reid of the

Financial Markets Authority for an order authorising the issue of search warrants

Hearing:                   19 June 2025

Appearances:           B Finn and S Lowery for Applicant

R Mansfield K C and S L Cogan for the Clarkes R Reed KC for Mr A

J Dixon KC and H Lanham for Mr B (written submissions only)

Judgment:                21 July 2025

JUDGMENT OF ANDERSON J

This judgment was delivered by me on 21 July 2025 at 4.15 pm pursuant to r 11.5 of the High Court Rules 2016.

………………………………

Registrar/Deputy Registrar

Solicitors: Luke Cunningham Clere, Auckland

Re FINANCIAL MARKETS AUTHORITY APPLICATION [2025] NZHC 2010 [21 July 2025]

Introduction

[1]    The Financial Markets Authority (FMA) is investigating the Du Val Group, controlled by John Kenyon and Charlotte Clarke, for potential breaches of “financial markets legislation” as defined in the Financial Markets Authority Act 2011 (FMAA).1 The investigation involves former Du Val personnel — Mr and Mrs Clarke, Mr A, and Mr B.2

[2]    This decision concerns the FMA’s “on-notice” application for five search warrants (the New Warrants) under s 29 of the FMAA.

[3]    The application is novel. The FMA has already seized the relevant material under warrants executed in 2024 (the Initial Warrants). These already authorise the searches the FMA wants to undertake. The FMA does not seek the New Warrants because an extension of its current search powers is required. Rather, it applies to the Court for New Warrants because it accepts that legitimate questions arise as to the lawfulness of the Initial Warrants under which it seized the material.3

[4]    The respondents oppose the application, arguing there is no jurisdiction to issue the New Warrants, or that doing so would be improper or an abuse of process.4 They do not currently contest the evidential sufficiency for the New Warrants but reserve their position on that issue.

Procedural background

[5]    In February 2024 and August 2024, the District Court issued search warrants to search a solid-state drive (SSD) for documents related to Du Val. The February warrant related to the FMA’s investigation into an investment known as the Build to Rent Fund. The FMA undertook searches to identify potentially relevant documents and has reviewed the responsive documents.

1      Under s 4(1), “financial markets legislation” is defined broadly by reference to legislation listed in sch 1. In addition to the Financial Markets Conduct Act 2013, this includes the Companies Act 1993, and certain offences under the Crimes Act 1961.

2      I granted suppression of the names and identifying particulars of these persons until further order of the Court in my Minute of 17 June 2025.

3      R v Pikia [2024] NZCA 408, (2024) 31 CRNZ 464.

4      Mr A’s formal position is that he is neutral to the application, although he filed a memorandum submitting that it was open to the Court to find that it has no jurisdiction to issue the New Warrants.

[6]    The August search warrant related to the FMA’s investigation into an investment known as the Mortgage Fund. The FMA has run preliminary searches of the material recovered under the August warrant, using key words to identify responsive documents. However, it has not yet reviewed those documents.

[7]    In August 2024, the High Court also issued warrants to search the Du Val office premises, the Clarkes’ residence, the homes of Mr A and Mr B, devices such as phones and computer systems at each of the locations, and cloud-based applications accessed through the various devices/computers. The devices seized were cloned and returned, except for Mr A’s phone, which remains secured and inaccessible to the investigation team. Under the Initial Warrants (or by consent in one instance),5 the FMA has extracted cloud-based data through the devices other than data from Mr A’s phone. The FMA has not yet searched the material cloned or extracted under the High Court warrants.

R v Pikia

[8]    On 28 August 2024, the Court of Appeal issued its judgment in R v Pikia. The Court of Appeal found that various search warrants issued to the Serious Fraud Office were invalid because they were “overbroad” and akin to general warrants.6

[9]    The FMA says this decision  prompted  it  to  apply  for  the  New Warrants. It states that it seeks to ensure that any searches it now intends to carry out on the previously seized material are lawful, due to doubts raised by the breadth of the warrants found to be invalid in R v Pikia.

[10]   The respondents reject the FMA’s characterisation of the R v Pikia decision as an intervening development. They say the need for specificity is well-established by

5      Mr B gave consent to a search of cloud data accessible via his device during execution of the Initial Warrants on 2 August 2024. He later withdrew his consent on 6 August 2024. The data extraction was already complete by the time consent was withdrawn.

6      A general warrant is one which does not describe the parameters of the warrant, either as to subject-matter or location, with enough specificity: see Tranz Rail Ltd v District Court at Wellington [2002] 3 NZLR 780 (CA) at [38]; and Dotcom v Attorney-General [2014] NZSC 199, [2015] 1 NZLR 745 at [32].

previous case law.7 There is some merit in that proposition, although this question of “cause and effect” is not material to my decision.

The FMA’s application

[11]   The five search warrants now sought by the FMA relate to the following material:

(a)data from the devices seized at the Clarkes’ residence;

(b)data extracted from the devices obtained at Du Val’s office premises and the cloud-based data downloaded from its server;

(c)data extracted from Mr A’s phone and the data accessed and downloaded through the phone by consent from five cloud-based platforms;

(d)data on the SSD;

(e)data extracted from Mr B’s phone; and

(f)within the warrant sought in (e), access and search of certain cloud-based applications from Mr B’s phone.

[12]   The New Warrants differ from the Initial Warrants in that they provide considerably greater specificity as to the evidential material being searched for and as to the suspected contraventions of financial markets legislation (including the time periods to which they relate).

Statutory context

[13]   Under s 29 of the FMAA, the FMA requires a warrant to “search” a “thing” unless consent is given. The Court may issue a search warrant “in relation to a place,

7      R v Williams [2007] NZCA 52, [2007] 3 NZLR 207 at [208]-[245].

vehicle, or thing” where the Court is satisfied that there are reasonable grounds to believe:

(a)a person has engaged in or is engaging in conduct that constitutes or may constitute a contravention, or being involved in a contravention, of any provision of the financial markets legislation;8 and

(b)that “the search will find evidential material in or on or part of the place, vehicle, or thing”.9

[14]   These statutory grounds parallel the grounds for issuing a search warrant in s 6 of the Search and Surveillance Act 2012 (SSA).10 Part 4 of the SSA applies with necessary modifications to search warrants issued under the FMAA.11

[15]The purpose of the SSA is:

to facilitate the monitoring of compliance with the law and the investigation and prosecution of offences in a manner that is consistent with human rights values by—

(a)modernising the law of search, seizure, and surveillance to take into account advances in technologies and to regulate the use of those technologies; and

(b)providing rules that recognise the importance of the rights and entitlements affirmed in other enactments, including the New Zealand Bill of Rights Act 1990, the Privacy Act 2020, and the Evidence Act 2006; and

(c)ensuring investigative tools are effective and adequate for law enforcement needs.

[16]   Neither s 29 nor pt 4 of the SSA define what constitutes a “search” or “seizure”. These terms carry their ordinary meaning, developed at common law, and in the

8      Section 29(1)(a). As noted earlier at n 1, “financial markets legislation” is defined broadly by reference to legislation listed in sch 1.

9      Section 29(1)(b).

10 Under s 6(1)(a), there must be reasonable grounds to “suspect that an offence specified in the application and punishable by imprisonment has been committed, or is being committed, or will be committed”.

11 This excludes ss 118 and 119 which confer certain incidental powers of detention and powers of search incidental to powers of arrest.

context of the right to freedom from unreasonable search or seizure in s 21 of the New Zealand Bill of Rights Act 1990 (NZBORA).

[17]   The leading case is R v Hamed, decided prior to enactment of the SSA.12 There, the Court was unanimous that search warrants issued under the Summary Proceedings Act 1957 could not authorise entry on property to place video surveillance. Blanchard J (writing what can be considered the lead judgment) discussed the concepts of “search” and “seizure”:

(a)“search” involves an intrusion on a reasonable expectation of privacy (a physical, or electronic inspection of property);13

(b)the fundamental essence of “seizure” is removal of a thing from someone else’s possession;14 and

(c)search and seizure need not occur simultaneously. They may also be separate events with one occurring without the other.15

[18]   Although the SSA does not define “search” or “seizure”, it does define a “search power”.16 This encompasses powers under search warrants and powers to search without a warrant that are conferred by legislation.

[19]   Section 97 of the SSA defines a “thing” to include an intangible thing. It also defines a “thing seized” in an exclusionary manner. This does not include “anything made or generated by a person exercising a search or surveillance power (for example

… a forensic copy of a computer hard drive)”.

[20]Certain other relevant definitions in s 3 of the SSA are as follows:

12     Hamed v R [2011] NZSC 101, [2012] 2 NZLR 305. On what constitutes a “search”, see also

Tamiefuna v R [2025] NZSC 40 at [16]–[23].

13 At [163].

14 At [150].

15 At [152].

16     Section 3(1).

(a)A “computer system” is broadly defined to include a computer, interconnected computers, any communication links between computers, or to remote terminals or another device. It also includes storage and stored data of a computer. Devices such as a cell phone fall within the definition of a computer or data storage device.17

(b)“Evidential material” is used with reference to what is being searched for and what can be seized. “Evidential material” is defined to include evidence, “tangible or intangible”, of relevance to the investigation of an offence. It therefore includes data.

(c)“Remote access search” is defined in the SSA as “a search of a thing such as an internet data storage facility that does not have a physical address that a person can enter and search”.18

[21]   Section 98 sets out what an application for a search warrant must contain. This includes the period for which the warrant is sought. If the applicant wants to be able to execute the warrant on more than one occasion, the application must explain why this is necessary. By s 98(3) the applicant is required to disclose the details (and result) of any other application for a search warrant known to have been made within the previous three months in respect of the place, vehicle, or other thing proposed to be searched.19

[22]   Under s 106 of the SSA, a search warrant is “executed” when the person executing the warrant and any person assisting in the execution of the warrant has seized all the items specified in the warrant, or leaves the place, vehicle, or other thing being searched and does not return within four hours.

17 Song v R [2016] NZCA 641 at [16]; Dotcom v Attorney-General, above n 6, at [191]; R v Vu 2013 SCC 60, [2013] 3 SCR 657 at [38]; R v Fearon 2014 SCC 77, 2014 SCC 77 at [51]; and Riley v California 573 US 373 (2014) at 393.

18 Section 3(1).

19 Under s 98(4), before applying for a search warrant, the applicant is required to make reasonable inquiries within the law enforcement agency in which the applicant is employed or engaged for the purpose of complying with s 98(3).

[23]   Execution of a warrant that extends to data on a computer system is complete upon seizure of the relevant device that forms part of that system. However, execution is distinct from searching the contents of the computer system, which may be done for as long as the device is in custody. 20

[24]   Under s 107, a search warrant is invalid where the grounds of issue (here, in  s 29 of the FMAA) were not satisfied when the warrant was issued; or if the warrant contains a defect, irregularity, omission, or want of form that is likely to mislead anyone executing or affected by the warrant as to its purpose or scope. These statutory grounds are not the only grounds for invalidity, as evident in R v Pikia. Warrants that are too broad in scope will be defective.21

[25]   Section 110 sets out what a “search power” authorises a person to do. This includes authority:

(a)to enter and search the place, vehicle, or other thing that the person is authorised to enter and search, and any item or items found in that place or vehicle or thing, at any time that is reasonable;22

(b)to seize anything that is the subject of the search or anything else that may be lawfully seized;23

(c)to use any reasonable measures to access a computer system or other data storage device located (in whole or in part) at the place, vehicle, or other thing if any intangible material that is the subject of the search may be in that computer system or other device;24 and

(d)if any intangible material accessed under the previous paragraph is the subject of the search or may otherwise be lawfully seized, to copy that

20     See R v R [2018] NZCA 341 at [23].

21     Tranz Rail Ltd v District Court at Wellington, above n 6.

22     Section 110(a).

23     Section 110(d).

24 Section 110(h). The words “located (in whole or in part) at the place” relate to the location of the device not the place at which the device is to be searched: Holland v Police [2017] NZHC 2284 at [41].

material (including by means of previewing, cloning, or other forensic methods either before or after removal for examination).25

[26]   Because a “thing seized” excludes anything generated in exercise of a search power such as forensic copies of data, such material is not subject to certain notice and inventory requirements in the SSA for seized items.26 Nor is generated material subject to requirements to return things seized in sub-pt 6 of pt 4. Specifically, s 150 provides that a thing seized that is not required for the investigation or for evidential purposes must be returned to its owner or the person entitled to its possession as prescribed.

[27]   In contrast, forensic clones of data copied under s 110(i) are addressed in s 161. Section 161(1) provides that if a person has taken a forensic copy of intangible material that is the subject of the search, they must delete it in a way that prevents its retrieval if they determine that the data does not contain any evidential material. Section 161(2) provides that where examination shows that the forensic copy contains a mixture of data that is evidential material and data that is not, the forensic copy may be retained in its entirety. This may then continue to be searched if the search was authorised by the search power under which the data was seized and copied.

The FMA’s submissions

[28]   The FMA’s primary case27 is that it seeks search warrants over a “thing”, being the intangible data it now holds.28 It says that s 110(a) of the SSA authorises a search of such data, provided the prerequisites for obtaining a warrant in s 6 are satisfied.

[29]   Searching material from electronic devices has been recognised as raising special privacy concerns. This is because of the nature and extent of information that

25 Section 110(i).

26 For instance, the seized item would not be subject to s 133, which provides that the person carrying out a search or seizure must provide an inventory of items seized to the person it was seized from. There is also a regime for dealing with a “thing seized” with reference to privileged material in sub-pt 6 of the SSA.

27 I return later to an aspect outside this primary scenario, being the power sought to search cloud applications accessed through Mr A’s phone.

28 As discussed at [19] above, under s 97 “thing” includes intangible things.

they hold, and which searchers must examine, if a search is to be effective.29 The FMA says it is acting responsibly by obtaining fresh search warrants before taking the invasive step of searching the material it holds, ensuring compliance with the law after R v Pikia.

[30]   The FMA acknowledges that the SSA does not expressly address a further search warrant being issued to search data held under an executed warrant. However, it argues that s 98(3) of the SSA anticipates the possibility of successive warrants in that it requires disclosure of prior warrant applications relating to the subject of the proposed seizure and search, and the result of those applications.

[31]   The FMA relies on case law, particularly Tupoumalohi v R30 and McLean v R,31 to support the proposition that a warrant can (and should, here) be sought to search electronic material already in the investigating agency’s possession. In doing so, the FMA distinguishes between the act (or power) of seizure that has already occurred and the act (or power) of search. The FMA no longer contends, as it did in written submissions, that what it seeks is the power to “re-seize” material already in its possession.

[32]   The FMA emphasises that its application is prospective only. It does not seek retrospective validation of the Initial Warrants, which remain open to challenge by the respondents in due course. The FMA also says that the New Warrants will remain open to challenge.

Analysis

Jurisdiction

[33]   By reference to the above statutory framework, the FMA has taken “forensic copies” or extracted intangible material that were the subjects of the Initial Warrants. This material was taken from “computer systems” that were seized (or accessed remotely) under those warrants. The Initial Warrants were executed when the devices

29     Dotcom v Attorney-General, above n 6, at [191]; and Hager v Attorney-General [2015] NZHC 3268, [2016] 2 NZLR 523 at [137] and [139].

30     Tupoumalohi v R [2020] NZCA 117.

31     McLean v R [2015] NZCA 101.

were seized.32 The material generated from the devices may be retained and further examined or searched.33

[34]   No fresh act of seizure, as far as “seizure” is defined in Hamed v R, is contemplated under the New Warrants. Rather, the FMA seeks to search what it has already seized and copied (or extracted) under authority of the Initial Warrants.

[35]   As discussed in Hamed, seizure and search can be discrete acts, with one occurring without the other. “Search” has more than one dimension here. There has been a search for a device at a place. There can also be a search of material held on or accessed through that device. However, the search that would be authorised by the New Warrants is already authorised by the Initial Warrants.34 That is, the Initial Warrants authorise both the seizure of the devices/computers and the search of the data on or accessed through them.

[36]   The statutory framework does not expressly authorise — nor does it expressly prohibit — issuing duplicate warrants over material already held in execution of a prior warrant. The FMA suggests that the jurisdiction to do so is implicit in s 98(3) of the SSA. Section 98(3) requires the applicant to disclose any warrant applications from the previous three months in respect of the place, vehicle or thing proposed to be searched, and their result. The purpose of s 98(3) is to prevent forum shopping for warrants and an oppressive multiplicity of similar warrants.

[37]   Section 98(3) contemplates that there may be a subsequent warrant application in respect of the same place, vehicle or other thing. There is ample scope for when this might occur without direct duplication of powers in an executed warrant. Examples are a search for a different item at a place, or of a computer for a different purpose than the prior warrant. A further warrant may also be required when the applicant has been unable to execute the previous warrant within the time required for execution, or where the initial search powers are not sufficiently extensive.

32     SSA, s 106.

33     Section 161.

34     See R v R, above n 20, at [23] and R v R [2020] NZCA 64, [2020] 2 NZLR 590 at [82].

[38]   I do not consider that s 98(3) supports the view that Parliament intended a second warrant to be available in respect of material already held under an executed prior warrant where no further warrant is required. On the contrary, the obligation to disclose appears designed to avoid duplicative warrants. Accordingly, s 98(3) does not provide a proper basis for issuing a further warrant where the search power sought of material already seized is already authorised by a prior warrant.

[39]   Nor do the authorities cited by the FMA assist. I refer to the two primarily relied upon.35 In Tupoumalohi v R, the Court of Appeal ruled that the police lawfully seized a phone under s 112 of the SSA (which permits items to be seized on a provisional basis where there is uncertainty as to whether they may lawfully be seized). However, the Court held that once the police later appreciated it was not the phone specified in the original warrant, they acted unlawfully by retaining and searching its contents.36 In obiter, the Court considered that a fresh warrant should have been obtained to lawfully retain (the Court used the word “re-seize”) and search the phone’s contents.37 Nonetheless, the evidence was admitted under s 30 of the Evidence Act. This was partly because the Court considered that such a warrant would likely have been granted if sought.38 I note that in Tupoumalohi v R, the initial search and seizure was held to be lawful.

[40]   In McLean v R, the police took possession of the defendant’s cell phone during a warrantless search. The phone was subsequently taken by the police for safekeeping. The police later searched material on the cell phone without the defendant’s consent. The Court of Appeal held that a search warrant could and should have been obtained to search the cell phone.39 The Court emphasised the special privacy concerns that arise when seizing and searching such devices.40

35 Mr Lowery referred me to various authorities from other jurisdictions, but he acknowledged that none of these were of particular assistance. These were R v Vu, above n 17; R (on the application of Cook) v Serious Organised Crime Agency [2010] EWHC 2119 (Admin), [2011] 1 WLR 144; Chief Constable of Merseyside Police v Hickman [2006] EWHC 451 (Admin), [2006] All ER (D) 04 (Mar); R (on the application of Kingdom Corporate Ltd) v Revenue and Customs Commissioners [2023] EWHC 3315 (Admin), [2024] 1 WLR 2157; and Director of Public Prosecutions v McDermott [2022] IECA 334.

36 Tupoumalohi, above n 30, at [56].

37 At [67].

38 At [68].

39 McLean v R, above n 31, at [37].

40 At [25]–[27].

[41]   Tupoumalohi v R and McLean v R illustrate that a warrant can be obtained to search a device and/or to search intangible material from the device when the device itself has already been seized (or is otherwise in the possession of the investigating agency). However, these cases address situations where an extension of the search power was required to search the intangible material. They are to be distinguished from the present case, where the Initial Warrants already authorise the searches the FMA now seeks to undertake.41

[42]   The FMA applies for the New Warrants because it has identified uncertainty about the breadth of the Initial Warrants. The FMA expressly does not concede they are unlawful. It says unless and until there is a ruling to the contrary, the Initial Warrants remain valid. Neither the FMA nor the respondents suggest that it would be appropriate for me to test or determine the validity of the Initial Warrants at this time.

[43]   Rather, the parties agree that the appropriate avenue to challenge a search warrant is after any charges have been laid. A defendant can then apply for a pre-trial ruling or can contend at trial that evidence from the warrants should be excluded under s 30 of the Evidence Act. That involves the court assessing whether excluding the evidence obtained is proportionate to the impropriety, balancing the seriousness of the breach against the need for a credible justice system.42 The parties’ agreed position reflects that the Courts are reluctant to entertain a pre-charge assessment of the validity of warrants. 43

[44]   Assuming the Initial Warrants are valid, the search powers sought under the New Warrants are redundant. The FMA is already permitted to search forensic copies of intangible material generated and now held subject to the provisions outlined earlier. The New Warrants have utility only if the initial warrants are invalid. Yet in this latter event, the FMA had no power or right to access the data. It would not have had the power to clone or generate the material it currently holds.

41     See R v R, above n 20; and at paragraph [23] above.

42     Section 30(2).

43     Gill v Attorney-General [2010] NZCA 468, [2011] 1 NZLR 433.

[45]   In my view, the SSA does not contemplate issuing a search warrant in respect of specific material where the warrant only has utility if it is assumed that the material was seized or generated unlawfully. This is for two reasons:

(a)First, given the relationship between an unlawful and an unreasonable search,44 issuing a warrant in these circumstances would be contrary to the purposes of the SSA. More specifically, it would be contrary to facilitating the investigation and prosecution of offences in a manner that is consistent with human rights values, especially in light of the SSA’s aim of recognising the importance of rights and entitlements affirmed in NZBORA and the Privacy Act. Indeed, if a warrant is valid (the working assumption here, in absence of any concession by the FMA), issuing a search warrant that is unnecessary has the potential to be oppressive.

(b)Secondly, if a new warrant encompassing the same ground is justified as “necessary” simply because the search warrant that has been executed might be invalid, the Court risks being perceived as assisting a potentially invalid act by the investigating agency. Moreover, to issue a new warrant reduces the incentive on the investigating agency to take care when defining the proper scope of the warrant in the first instance.

[46]   It would be open for the legislature to expressly accommodate an application for a further search warrant over evidential material held under a doubtful warrant.45 I do not consider that such provision can, or should, be implied.

[47]   A key counterargument is that the validity of both the Initial Warrants and the New Warrants can be determined in due course, and the only issue the Court should

44   See R v Williams [2007] NZCA 52, [2007] 3 NZLR 207 at [12]–[24] for more detailed discussion of this issue.

45 Such a provision would bear some resemblance to s 59 of England’s Criminal Justice and Police Act 2001. Section 59 deals with applications by persons with a relevant interest in seized property for the return of that property on a range of grounds. One such ground is where there was no power to make the seizure in the first place. In turn, s 59(6) and 59(7) provide that an investigating agency can apply to retain seized material on a number of grounds. One ground is if a warrant would immediately be granted if the material was returned to the person it was seized from.

be concerned with now is whether the s 6 grounds for a search of the intangible material seized are established.

[48]   In R v Alsford,46 the Supreme Court held that there is no blanket prohibition on granting search warrants that are supported by evidence ruled inadmissible in an earlier proceeding because it was unlawfully obtained (in that case, pursuant to an unlawful warrant). It could be said that here, it is irrelevant whether the intangible material sought to be searched has been obtained and retained under a potentially unlawful warrant. I should simply make a forward-looking assessment of whether the search order should be made, with the Court later making an assessment whether any invalidity has consequence.

[49]   I do not consider that R v Alsford bears on the present circumstances. This is not a scenario as in R v Alsford where the grounds for the present application are founded on evidential material obtained under a previous warrant. Rather, the New Warrants seek to search the very material that was the subject of the Initial Warrants, being material generated under them. There is a convergence between the Initial Warrants and the New Warrants that I consider leaves no space for both to co-exist.47

[50]   It may be said that the SSA must surely accommodate issuing a new search warrant that is less intrusive. However, this ignores that the first warrant still authorises the search over the material already seized. An issue would also arise as to which warrant governs, potentially causing confusion. Limiting the search is always open to the investigating agency if it forms the view that the search can or should be less invasive.

[51]   Finally, I address Ms Reed’s submission that for the Court to entertain the present application at a pre-charge phase (rather than in the context of whether evidence obtained should be admitted under s 30) is a waste of judicial resources in the same way as judicial reviews of warrants are discouraged before charges are laid.

46 R v Alsford [2017] NZSC 42, [2017] 1 NZLR 710.

47 The facts of the present scenario are also a step beyond R v Williams, above n 7. There, evidential material was obtained unlawfully under a warrant that was later held to be invalid. That evidence was crucial to the obtaining of a second warrant, under which more evidence was seized. The evidence seized under the second warrant was deemed to be “tainted” as a result.

[52]   The primary basis for the courts’ reluctance to entertain issues about the validity of warrants at an investigatory stage is that judicial review is usually the only mechanism to do so. Warrants are usually issued without notice, as was the case for the Initial Warrants. Relief by way of judicial review is usually not appropriate because there is a readily available alternate remedy in the form of a pre-trial challenge to the evidence obtained on execution of the warrant (as discussed above). Moreover, review is not an appropriate forum to assess sufficiency of evidence in support of warrants, (although judicial review on the basis of specificity of the warrant has been successful48). The Court is also opposed to pre-charge challenges that can bring a criminal investigation to a halt.49

[53]   Accordingly, the judicial reluctance is only incidentally because pre-charge review is a waste of judicial resources if charges are not laid. However, I accept there is some force in Ms Reed’s submission that there is sound policy against entertaining pre-trial applications by an investigating agency for search powers already conferred, over evidential material already held, and where there are concerns about the breadth of the original warrants.

[54]   As Ms Reed also said, that does not mean a subsequent finding of invalidity would result in evidential material being excluded. Whether that would be the case will turn on an assessment under s 30. It is open to the FMA to conduct limited searches of the material it holds. In the context of judicial review of an overly broad warrant, the Court has previously postulated relief by way of permitted retention of only the material that would have been obtained under a hypothetically compliant warrant.50

Discretion

[55]   Earlier, I have characterised the objection to issuing the New Warrants as one of jurisdiction. I do not consider they are contemplated by the legislative framework. If I am wrong, the policy reasons and analysis in [44]–[54] leads me to conclude that the Court should not exercise the residual discretion in s 6 to issue warrants in the

48     See Tranz Rail Ltd v District Court at Wellington, above n 6.

49     The matters in this paragraph were discussed in Gill v Attorney-General above n 43.

50     Dotcom v Attorney-General [2013] NZHC 1269 at [50].

present circumstances.51 In that regard, I accept the respondents’ submission that it is not a proper exercise of the Court’s jurisdiction under the SSA to seek to insulate an investigating agency from any deficiencies in previous search warrants, noting that the investigating agency maintains the first warrants are valid.

Mr B’s phone

[56]   The central focus of the above analysis has been on the forensic copies the FMA made of seized or extracted material. The fresh warrant sought by which the FMA intends to access cloud-based applications from Mr B’s phone is somewhat different. In that case the FMA has not copied material and hence there is no “thing” that has yet been generated pursuant to the Initial Warrants.

[57]   Nonetheless, the relevant initial warrant already permits access to cloud-based applications accessible through Mr B’s phone for data existing at the date the phone was seized. The Court of Appeal has held that a cloud-based application and the cell phone it is accessed through form one discrete computer system for the purposes of the SSA.52 Under s 110(h), if only part of a computer is located at the place being searched, such as a cell phone, the whole of the computer system may be searched.53 This includes cloud-based applications accessible from and connected to the cell phone.54

[58]   Under the original warrants issued by Campbell J, the FMA was entitled to seize and search Mr B’s phone. It was therefore entitled (and remains entitled)55 to search the phone and any cloud-based application accessible through it. Accordingly, the power sought duplicates a power that has already been conferred on the FMA. In my view, the same outcome follows on this aspect of the application. The Initial Warrants already authorise the search, and the power is only required if the Initial Warrants are invalid.

51     Under s 6, the issuing officer (here the Court) “may issue a warrant”.

52     R v R [2020] NZCA 64, [2020] 2 NZLR 590 at [82].

53 At [83].

54 At [83]. No remote access authority is required in such circumstances.

55     As discussed previously at [23], once a device such as a cell phone has been seized, it may be searched for as long as the device is held in custody under the warrant.

Result

[59]I dismiss the FMA’s application for search warrants.

Anderson J